The fallout from the government’s failed $535 million bet in solar panel maker Solyndra expanded on Friday, with the Obama administration seeking an independent audit of Energy Department loans even as the Republican-led House Energy committee threatened a subpoena of the president.
White House officials said the audit would focus on the health of existing loans in the Energy Department’s multi-billion dollar portfolio of investments in clean tech firms.
Solyndra, the first recipient of Energy Department backing, collapsed in bankruptcy and is now the subject of multiple investigations. The Energy Department and White House backed the half billion dollar investment in Solyndra, government emails show, even as budget and Treasury officials were raising red flags.
“Today we are directing that an independent analysis be conducted of the current state of the Department of Energy loan portfolio, focusing on future loan monitoring and management,” White House chief of staff Bill Daley told the Associated Press. “While we continue to take steps to make sure the United States remains competitive in the 21st century energy economy, we must also ensure that we are strong stewards of taxpayer dollars.”
The audit will be conducted by former Treasury official Herb Allison, who stepped down in September 2010 after overseeing the Troubled Asset Relief Program. A former investment banker, Allison has served on the boards of financial and educational institutions and contributed to both Republicans and Democrats over the years, according to federal contribution records in the CQ MoneyLine database. He was national finance chairman for John McCain’s 2000 campaign.
Previous General Accountability Office reports have questioned the Energy Department’s handling of its loans and loan guarantees, saying the agency sometimes showed favoritism in making awards and didn’t always follow up to ensure projects were on track. “DOE has treated applicants inconsistently,” said one report. “Although our past work has shown that agencies should process applications with the goals of treating applicants fairly and minimizing applicant confusion, DOE’s implementation of the program has favored some applicants and disadvantaged others in a number of ways.”
Energy Department officials say they back game changing technologies, and that projects are awarded on merit.
The White House said the new audit will not include Solyndra, which is already facing investigations by the FBI and Inspectors General at the Treasury and Energy Departments, along with the House Energy and Commerce Committee.
As the White House pushed for the audit, Republican members of the House committee raised the stakes on their eight month investigation of the Solyndra loan.
Friday, House Energy and Commerce Chairman Fred Upton (R-Mich.) and investigations subcommittee head Cliff Stearns (R-Fla.) said they will hold a hearing Thursday to consider seeking a subpoena of “internal White House communications relating to the Solyndra loan guarantee.”
The White House, which has provided Congress 70,000 pages of correspondence from agencies within the government about Solyndra, has twice rejected the committee’s requests for internal White House correspondence – citing what White House counsel Kathryn Ruemmler called “long-standing and significant institutional executive branch confidentiality interests.”
Upton and Stearns said the White House has yet to invoke executive privilege – and do not believe it would apply in this case. “We fail to see why internal White House communications about a loan guarantee to a solar panel manufacturer would implicate issues of national security or the other foundations upon which the Supreme Court has recognized the Privilege,” they wrote in a statement.
The committee members said they may seek communications from Obama’s top aides, including former White House Chief of Staff Rahm Emanuel, Senior Advisor Valerie Jarrett, former National Economic Council Director Larry Summers, and Ron Klain, former Chief of Staff to Vice President Biden.
“Subpoenaing the White House is a serious step that, unfortunately, appears necessary in light of the Obama administration’s stonewall on Solyndra,” the statement said. “What is the White House trying to hide from the American public?”
Earlier this year, the Republican-led committee pressed a subpoena for Office of Management and Budget records on the Solyndra deal. That subpoena was approved in a vote that fell along party lines.
Rachael Marcus contributed to this report.
Help support this work
Public Integrity doesn’t have paywalls and doesn’t accept advertising so that our investigative reporting can have the widest possible impact on addressing inequality in the U.S. Our work is possible thanks to support from people like you.